https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/11658

**REPUBLIC OF KENYA** **IN THE HIGH COURT OF KENYA AT NAIROBI** **MILIMAMI LAW COURTS** **CIVIL APPELLATE DIVISION** **CIVIL APPEAL NO. E863 OF 2024** **NEW STATUS MOTORS LIMITED…........................1ST APPELLANT** **DANIEL MURIKI GITHUI…..................................2ND APPELLANT** **-VERSUS-** **GLADYS WAIRIMU NDEGWA............................1ST RESPONDENT** **POLESTAR MERCHANDISE CO. (K) LTD...........2ND RESPONDENT** **HAREN KUMAR MADHAVIA............................3RD RESPONDENT** (*Being an Appeal against the Judgment of in Milimani CMCC No. 3997 of 2016 delivered on 25th July, 2024 by Hon. C. A Ogweno)* **JUDGMENT** 1. This appeal arises from the Judgment delivered on **25th July 2024** in **Nairobi CMCC No. 3997 of 2016**. In the impugned Judgment, the learned trial magistrate entered judgment in favour of the 1st Respondent, granted orders compelling the transfer of motor vehicle registration number **KCC 727F Toyota Station Wagon** to her, dismissed the Appellants' counterclaim and ordered the 1st and 2nd Defendants in the subordinate court to bear the costs of both the suit and the counterclaim. 2. Being dissatisfied with the whole of that decision, the Appellants lodged the present appeal through a Memorandum of Appeal dated 26th July, 2024 raising various grounds challenging both the findings of fact and the conclusions of law reached by the learned trial magistrate. 3. The appeal invites this Court, sitting as a first appellate court, to determine whether the learned trial magistrate properly evaluated the evidence placed before the subordinate court, correctly applied the law governing contracts of sale, agency and transfer of property, and properly dismissed the Appellants' counterclaim. **Background** 1. The dispute giving rise to this appeal revolves around the ownership of motor vehicle registration number **KCC 727F Toyota Station Wagon**. 2. From the pleadings and the evidence summarised in the judgment of the subordinate court, it is common ground that the vehicle was offered for sale at an agreed purchase price of **Kshs.3,500,000**. It is further not disputed that the 1st Respondent ultimately took possession of the motor vehicle after surrendering another motor vehicle as part of the consideration and making further payments pursuant to the sale arrangement. The controversy concerns whether the agreed purchase price was fully settled, whether the persons who facilitated the transaction possessed authority to bind the registered owner of the vehicle, and whether the 1st Respondent thereby acquired an enforceable right to ownership and transfer of the motor vehicle. 3. Before the subordinate court, the 1st Respondent maintained that she lawfully purchased the motor vehicle after paying the agreed consideration, comprising a trade-in vehicle valued at **Kshs.650,000** together with the balance of the purchase price. She pleaded that despite fulfilling her obligations under the agreement, the Defendants failed and refused to execute the requisite transfer documents and instead threatened to repossess the vehicle through auctioneers. She consequently sought permanent and mandatory injunctive orders compelling the transfer of the vehicle into her name together with costs of the suit. 4. The Appellants, who were the 3rd Defendant and its director in the subordinate court, denied liability and filed a Defence accompanied by a Counterclaim. Their case was that although negotiations concerning the sale of the motor vehicle took place, the agreed purchase price was never fully paid. They contended that only the trade-in vehicle was received while the balance of **Kshs.2,850,000**, which was to be settled through post-dated cheques, was never remitted after the cheques were dishonoured. They further denied that the persons who dealt with the 1st Respondent acted as their agents and asserted that any representations made by those persons could not bind them. On that basis, they sought dismissal of the suit and, by way of counterclaim, prayed for recovery of the outstanding purchase price or alternatively return of the motor vehicle together with injunctive relief and costs. **The Judgment of the Trial Court** 1. After hearing the parties and considering the evidence tendered, the learned trial magistrate identified the principal questions for determination as whether an agency relationship existed between the parties involved in the transaction, whether the Plaintiff was entitled to the reliefs sought, whether the counterclaim had been proved, and who should bear the costs of the proceedings. 2. Upon evaluating the evidence, the learned magistrate found that the conduct of the Appellants and the intermediary who negotiated the sale created an agency relationship capable of binding the Appellants. The court reasoned that the intermediary had introduced the purchaser, the trade-in vehicle had been accepted, the payment arrangement had been sanctioned and possession of the motor vehicle had been voluntarily released to the 1st Respondent. In those circumstances, the learned magistrate concluded that the intermediary possessed at least apparent authority to transact on behalf of the Appellants and that the 1st Respondent was entitled to rely upon those representations. 3. The learned magistrate further found that the 1st Respondent had fulfilled her obligations under the sale agreement and was therefore an innocent purchaser entitled to transfer of the motor vehicle. The court held that any dispute regarding remittance of the purchase price was a dispute between the Appellants and the intermediary and could not defeat the rights of the purchaser who had acted in good faith. Consequently, the court ordered the execution of transfer documents, dismissed the counterclaim and awarded costs against the 1st and 2nd Defendants. **The Appeal** 1. Aggrieved by those findings, the Appellants preferred the present appeal. In their Memorandum of Appeal, they fault the learned trial magistrate, inter alia, for dismissing the counterclaim, finding that the purchase price had been fully paid, holding that an agency relationship existed, failing to properly evaluate the evidence, disregarding material admissions and documentary evidence, failing to determine the issues placed before the court, and generally arriving at a decision that was against the weight of the evidence. They consequently pray that the Judgment of the subordinate court be set aside and that the counterclaim be allowed with costs. 2. Although framed as twelve separate grounds, a careful reading of the Memorandum of Appeal reveals that the grounds substantially revolve around four broad complaints: whether the learned magistrate properly evaluated the evidence relating to payment of the purchase price; whether the finding on agency was legally sustainable; whether the dismissal of the counterclaim was justified; and whether the ultimate orders granted were supported by the evidence and the law. **Parties' Submissions** 1. Pursuant to directions issued by the Court, the appeal was canvassed by way of written submissions, which I have carefully considered alongside the Record of Appeal, the pleadings, the proceedings and the authorities relied upon by the parties. 2. The Appellants submit that the learned trial magistrate fundamentally misdirected herself in finding that the 1st Respondent had discharged the entire purchase price. They argue that the evidence demonstrated that only the trade-in vehicle valued at **Kshs.650,000** had been received and that the balance of **Kshs.2,850,000**, which was to be settled through post-dated cheques, was never paid after the cheques were dishonoured. It is therefore their case that ownership of the motor vehicle could not lawfully pass to the 1st Respondent. They further contend that the intermediary who negotiated the transaction was never appointed as their agent and that the learned magistrate erroneously imposed liability upon them on the basis of a non-existent agency relationship. They also submit that the learned magistrate failed to properly analyse the documentary evidence supporting the counterclaim and ought to have granted the reliefs sought therein. 3. The 1st Respondent, on the other hand, supports the judgment of the subordinate court. She submits that she lawfully purchased the motor vehicle after paying the agreed consideration, took possession with the knowledge and acquiescence of the Appellants and dealt throughout with a person who had been clothed with authority to transact on behalf of the dealership. She argues that she was an innocent purchaser for value who fulfilled her obligations under the agreement and that any dispute regarding the remittance of the purchase price lay solely between the Appellants and the intermediary. According to the 1st Respondent, the learned magistrate properly evaluated the evidence, correctly applied the law relating to agency and rightly dismissed the counterclaim. She therefore urges this Court to dismiss the appeal with costs. 4. Having carefully considered the Record of Appeal, the rival submissions and the authorities cited by counsel, I now turn to consider the duty of this Court as a first appellate court before identifying the issues that fall for determination. **Duty of a First Appellate Court** 1. This being a first appeal, the duty of this Court is well settled. A first appellate court is required to reconsider, re-evaluate and re-analyse the entire evidence tendered before the trial court and draw its own independent conclusions, while bearing in mind that it neither saw nor heard the witnesses testify and must therefore give due allowance for that disadvantage. 2. The principles governing the jurisdiction of a first appellate court have long been settled. In ***Selle & Another v Associated Motor Boat Co. Ltd & Others* [1968] EA 123**, the former Court of Appeal for East Africa stated that a first appellate court is not bound necessarily to follow the findings of fact by the trial court but must reconsider the evidence, evaluate it itself and draw its own conclusions, making due allowance for the fact that it has neither seen nor heard the witnesses. 3. The same principle has consistently been reaffirmed by the Court of Appeal. In ***Peters v Sunday Post Ltd* [1958] EA 424**, the Court observed that although an appellate court has jurisdiction to review the evidence in order to determine whether the conclusions reached by the trial court should stand, it should nevertheless exercise caution before differing from findings of fact made by a trial court that had the advantage of seeing and hearing the witnesses. 4. More recently, the Court of Appeal reiterated the same obligation in ***Abok James Odera t/a A.J. Odera & Associates v John Patrick Machira t/a Machira & Co. Advocates* [2013] eKLR**, where it held that the duty of a first appellate court extends to re-evaluating, reassessing and re-analysing the evidence on record before arriving at its own independent determination, while remembering that the trial court had the advantage of observing the demeanour of the witnesses. 5. The Supreme Court has similarly underscored that an appellate court must exercise its jurisdiction within the confines of the law governing appeals and interfere with findings of fact only where the circumstances justify such intervention. In ***Gatirau Peter Munya v Dickson Mwenda Kithinji & 2 Others* [2014] eKLR**, the Supreme Court observed that an appellate court may interfere where the trial court acted on no evidence, misapprehended the evidence, took into account irrelevant considerations, failed to consider relevant matters, or where the decision is plainly wrong in law. 6. Guided by those principles, this Court is under a duty to undertake its own independent evaluation of the pleadings, the oral and documentary evidence, the judgment of the learned trial magistrate, the grounds of appeal and the rival submissions before determining whether the impugned decision ought to stand. 7. It is equally settled that an appellate court will not interfere with findings of fact merely because it might have reached a different conclusion. Interference is warranted only where it is demonstrated that the findings are unsupported by the evidence, are based on a misapprehension of the evidence, or are founded upon wrong principles of law. This restraint preserves the distinction between the appellate function of review and the trial court's role as the primary finder of fact. **Issues for Determination** 1. I have carefully considered the Memorandum of Appeal, the pleadings before the subordinate court, the impugned judgment, the Record of Appeal and the rival submissions filed by the parties. 2. Although the Memorandum of Appeal contains twelve grounds of appeal, many of those grounds substantially overlap. The Appellants repeatedly challenge the trial court's evaluation of the evidence, its finding on agency, its conclusion that the 1st Respondent was entitled to ownership and transfer of the motor vehicle, and the dismissal of the counterclaim. In my view, determining each ground individually would result in unnecessary repetition without advancing the real issues in controversy. 3. The Court of Appeal has consistently encouraged courts to identify the real questions in controversy rather than determine disputes on the basis of the form in which complaints are framed. Accordingly, this Court is of the view that the twelve grounds of appeal may conveniently be condensed into the following issues, whose determination will effectively dispose of the entire appeal: 4. ***Whether the learned trial magistrate properly re-evaluated the evidence before the subordinate court and correctly found that the 1st Respondent had fulfilled her obligations under the agreement for the purchase of motor vehicle registration number KCC 727F.*** 5. ***Whether the learned trial magistrate correctly found that the persons who transacted with the 1st Respondent possessed actual or apparent authority capable of binding the Appellants and, consequently, whether the 1st Respondent became entitled to transfer of the motor vehicle.*** 6. ***Whether the learned trial magistrate properly dismissed the Appellants' counterclaim.*** 7. ***Whether the final orders issued by the subordinate court ought to be upheld, varied or set aside.*** 8. I am satisfied that these issues sufficiently encompass all the complaints raised in the Memorandum of Appeal. In determining them, the Court shall consider the pleadings, the evidence tendered at trial, the applicable statutory provisions and the relevant jurisprudence from the superior courts. 9. Before embarking on the substantive analysis, it is important to identify the point at which the parties' positions diverge. From the pleadings, evidence and submissions, there is little dispute that negotiations for the sale of motor vehicle registration number **KCC 727F** took place, that the agreed purchase price was **Kshs. 3,500,000**, that the 1st Respondent surrendered a motor vehicle as part of the consideration, and that she ultimately obtained possession of the suit motor vehicle. The real controversy lies elsewhere. 10. The Appellants contend that ownership could not pass because the balance of the purchase price was never received by them, the intermediary lacked authority to bind them, and the learned trial magistrate therefore erred in compelling transfer of the vehicle while dismissing the counterclaim. Conversely, the 1st Respondent maintains that she honoured her obligations under the transaction, dealt with a person who had been clothed with authority by the Appellants, and should not be prejudiced by any subsequent dispute between the Appellants and the intermediary concerning remittance of the purchase price. 11. It is therefore against that factual and legal backdrop that this Court proceeds to determine the first and second issues, which are closely intertwined, namely whether the learned trial magistrate properly evaluated the evidence relating to the sale transaction and whether the finding that the intermediary possessed authority to bind the Appellants was supported by the evidence and the applicable law. **Analysis and Determination** **Whether the learned trial magistrate properly evaluated the evidence and correctly found that the 1st Respondent had fulfilled her obligations under the agreement for the purchase of motor vehicle registration number KCC 727F.** 1. The first issue goes to the heart of the appeal. The Appellants contend that the learned trial magistrate failed to properly evaluate the evidence and consequently arrived at the erroneous conclusion that the 1st Respondent had fulfilled her contractual obligations and was therefore entitled to ownership and transfer of motor vehicle registration number **KCC 727F**. Their case is that although the agreed purchase price was **Kshs.3,500,000**, only the trade-in vehicle valued at **Kshs.650,000** was received, while the balance of **Kshs.2,850,000**, which was to be settled through post-dated cheques, was never remitted after the cheques were dishonoured. They therefore submit that title could not lawfully pass to the 1st Respondent. 2. The 1st Respondent, on the other hand, maintains that she honoured every obligation imposed upon her under the agreement. She contends that she surrendered her motor vehicle as part of the consideration, complied with the agreed mode of payment, took possession of the suit motor vehicle with the knowledge and concurrence of the Appellants and had every reason to believe that the transaction had been validly concluded. She argues that any subsequent dispute concerning the remittance of the purchase price arose between the Appellants and the intermediary and could not be visited upon an innocent purchaser. 3. It is evident from both the pleadings and the evidence as summarised in the judgment that certain facts were never seriously contested. The parties did not dispute that there was a sale transaction involving motor vehicle registration number **KCC 727F**, that the agreed purchase price was **Kshs.3,500,000**, that the 1st Respondent surrendered another motor vehicle valued at **Kshs.650,000** as part of the consideration, and that she was subsequently placed in possession of the suit motor vehicle. 4. The dispute before the subordinate court, and now before this Court, was therefore not whether a sale transaction existed, but whether the 1st Respondent performed her obligations under that transaction so as to entitle her to transfer of ownership notwithstanding the Appellants' assertion that they never ultimately received the balance of the purchase price. 5. Having independently reviewed the record, I am unable to agree with the Appellants' contention that the learned trial magistrate ignored the evidence. On the contrary, the judgment demonstrates that the learned magistrate appreciated the Appellants' case that the balance of the purchase price had allegedly not reached them. The learned magistrate nevertheless concluded that the evidence established that the 1st Respondent had performed the obligations expected of her and that any failure in the remittance of the purchase price arose from the dealings between the Appellants and the intermediary who facilitated the transaction. 6. In my respectful view, that distinction is critical. The question was not merely whether the Appellants ultimately received the purchase price, but whether the 1st Respondent herself was in breach of the agreement. Those are two distinct inquiries. A purchaser who has complied with the agreed mode of payment cannot automatically be said to be in breach merely because the funds were subsequently misappropriated or withheld by an intermediary acting within the scope of the transaction. 7. The Appellants' submissions proceed on the assumption that because they did not ultimately receive the balance of the purchase price, the 1st Respondent necessarily remained in default. However, that argument overlooks the factual inquiry undertaken by the trial court, namely whether the 1st Respondent had complied with the payment arrangement that had been presented to and accepted by her during the transaction. 8. The evidence accepted by the learned magistrate established that the 1st Respondent surrendered her motor vehicle as agreed, made the payments required of her under the transaction and was thereafter voluntarily given possession of the suit motor vehicle. There is no finding by the trial court, nor have the Appellants demonstrated from the record, that the 1st Respondent herself acted fraudulently, dishonestly or in breach of the agreed terms. Indeed, the Appellants' own case before the subordinate court was principally directed against the intermediary and the alleged dishonoured cheques rather than against any independent misconduct by the 1st Respondent. 9. It is also significant that the Appellants voluntarily released possession of the motor vehicle. Ordinarily, a seller who considers the purchase price unpaid would be expected to retain possession until the contractual conditions are satisfied. The decision to release possession was therefore an important factual circumstance which the learned magistrate was entitled to consider in determining whether the transaction had progressed to a stage where the purchaser was entitled to believe that the sale had been completed. 10. The Court of Appeal has repeatedly held that an appellate court should be slow to interfere with findings of fact unless they are plainly unsupported by the evidence. In ***Kiruga v Kiruga & Another [1988] KLR 348***, the Court held that an appellate court will not normally interfere with a finding of fact unless it is based on no evidence, is based on a misapprehension of the evidence, or the trial court is shown demonstrably to have acted on wrong principles. 11. Similarly, in ***Mwangi & Another v Wambugu [1984] KLR 453***, the Court of Appeal observed that a court on appeal should not substitute its own view of the evidence merely because it would have reached a different conclusion if there was evidence upon which the trial court could reasonably arrive at the conclusion reached. 12. Applying those principles to the present appeal, I am not persuaded that the Appellants have demonstrated any misdirection warranting appellate interference. Their complaint is essentially that the learned magistrate ought to have preferred their interpretation of the evidence over that advanced by the 1st Respondent. That, without more, is insufficient to justify disturbing findings of fact reached after a full evaluation of the evidence. 13. I also note that several grounds of appeal accuse the learned magistrate of ignoring documentary evidence. However, the Appellants have not demonstrated that the learned magistrate failed to consider any specific exhibit that would have materially altered the outcome of the case. The mere fact that the trial court did not accept the conclusions urged by the Appellants does not necessarily mean that the evidence was ignored. Judicial evaluation of evidence requires a court to weigh competing versions of events and assign appropriate weight to each. The appellate function is not to retry the case simply because one party is dissatisfied with the result. 14. Having independently reconsidered the evidence placed before the subordinate court, I am satisfied that the learned trial magistrate properly identified the real controversy between the parties and cannot be faulted for concluding that the 1st Respondent had discharged the obligations expected of her under the transaction. The evidence reasonably supported the finding that the dispute regarding the unpaid balance, if any, arose after the 1st Respondent had performed her part of the bargain and therefore constituted a dispute between the Appellants and the intermediary rather than a default attributable to the purchaser. **Whether the learned trial magistrate correctly found that the intermediary possessed actual or apparent authority capable of binding the Appellants.** 1. The second issue is closely intertwined with the first because the Appellants' challenge to the finding that the 1st Respondent fulfilled her obligations largely rests on their contention that the intermediary lacked authority to receive payment or negotiate the transaction on their behalf. 2. The Appellants submit that there was no written agreement appointing the intermediary as their agent and that, in the absence of such appointment, the learned magistrate erred in concluding that his actions could bind them. Conversely, the 1st Respondent argues that the Appellants' own conduct clothed the intermediary with authority, thereby entitling her to rely on his representations. 3. The law relating to agency is well settled. Agency need not always arise from an express written appointment. It may equally arise by implication from the conduct of the parties or through the doctrine of apparent or ostensible authority. Where a principal, by words or conduct, represents that another person has authority to act on his behalf, and a third party acts upon that representation in good faith, the principal may be estopped from denying the existence of that authority. 4. The Court of Appeal in ***Kenya National Capital Corporation Ltd v Albert Mario Cordeiro & another [2014] eKLR*** recognised that ostensible authority arises where a principal, by conduct, leads a third party reasonably to believe that another person has authority to act on its behalf, and the third party relies upon that representation. 5. In the present appeal, the learned trial magistrate did not base the finding of agency solely on the assertions of the 1st Respondent. Rather, the finding was drawn from the totality of the parties' conduct. The evidence accepted by the trial court showed that the intermediary introduced the purchaser, negotiated the transaction, facilitated acceptance of the trade-in vehicle, participated in the agreed payment arrangement and, significantly, the Appellants ultimately released possession of the motor vehicle pursuant to that arrangement. 6. In my view, those were factual circumstances from which the learned magistrate was entitled to infer that the intermediary had, at the very least, apparent authority to transact on behalf of the Appellants. A third party dealing with such a person would reasonably believe that he possessed authority to conclude the transaction. The law protects third parties who rely on such representations in good faith. 7. The Appellants argue that there was no written authority. While that may be so, the absence of a formal written appointment is not, by itself, determinative. Commercial relationships are frequently conducted through agents whose authority is evidenced by conduct rather than by formal documentation. The critical inquiry is whether the principal's conduct would lead a reasonable person to believe that the agent possessed authority to act. 8. Upon my own independent evaluation of the record, I find no basis for interfering with the learned magistrate's conclusion that the intermediary acted with apparent authority. That finding was grounded in the evidence before the court and accords with the applicable principles of agency. The Appellants cannot, after facilitating the transaction to the point of releasing possession of the motor vehicle, seek to avoid its consequences by denying the very authority that their own conduct appeared to confer. 9. Consequently, I find no merit in the Appellants' challenge to the trial court's findings on the evaluation of the evidence or on the issue of apparent authority. Those findings were supported by the evidence on record and were founded upon correct legal principles. **Whether the Learned Trial Magistrate Erred in Dismissing the Appellants' Counterclaim** 1. The third issue for determination concerns the propriety of the learned trial magistrate's decision to dismiss the Appellants' counterclaim. The Appellants submit that the counterclaim was supported by both oral and documentary evidence and that the learned magistrate failed to properly evaluate that evidence before dismissing it. They contend that the evidence demonstrated that the purchase price remained unpaid, that the intermediary acted without authority, and that they were therefore entitled either to recovery of the outstanding purchase price or to repossession of motor vehicle registration number **KCC 727F**. 2. The 1st Respondent, on the other hand, supports the dismissal of the counterclaim. She maintains that she honoured her obligations under the transaction and that the Appellants' complaint concerns the alleged failure by the intermediary to remit the purchase price to them. According to the 1st Respondent, the counterclaim sought to transfer to her the consequences of a dispute in which she played no part. 3. From the pleadings filed before the subordinate court, the counterclaim was founded upon three principal assertions. First, that the intermediary had no authority to dispose of the motor vehicle on behalf of the Appellants. Secondly, that the purchase price remained outstanding because the post-dated cheques issued in settlement thereof were dishonoured. Thirdly, that as a consequence of those matters, the Appellants were entitled either to recover the outstanding balance or to recover possession of the motor vehicle. 4. A counterclaim is a distinct and independent cause of action. Although pleaded within a defence, it stands as a cross-suit and must be proved in the same manner as any other civil claim. It is therefore incumbent upon the party asserting the counterclaim to establish, on a balance of probabilities, the facts upon which the relief sought is founded. 5. **Sections 107, 108 and 109 of the Evidence Act** embody the fundamental principle that he who alleges must prove. The legal burden rests upon the party who would fail if no evidence were adduced, while the evidential burden may shift depending on the circumstances disclosed by the evidence. 6. The Court of Appeal in ***Palace Investment Ltd v Geoffrey Kariuki Mwenda & Another [2015] eKLR*** reaffirmed that in civil proceedings the burden of proof rests upon the party asserting a fact and that such burden is discharged on a balance of probabilities. The Court further observed that proof on a balance of probabilities means that the evidence adduced must establish that the existence of the asserted fact is more probable than its non-existence. 7. It follows, therefore, that once the Appellants pleaded that the purchase price had not been paid and that they were entitled to recover either the outstanding balance or the vehicle itself, the burden rested upon them to establish those assertions through cogent evidence. 8. Having independently reviewed the record, I am satisfied that the learned trial magistrate did not dismiss the counterclaim merely because the Appellants had suffered no loss. Rather, the court found that the loss complained of, if any, arose from the dealings between the Appellants and the intermediary after the 1st Respondent had already fulfilled the obligations expected of her under the sale transaction. It is for that reason that the learned magistrate concluded that the counterclaim could not properly lie against the 1st Respondent. 9. That conclusion cannot be viewed in isolation from the findings already made by this Court under the first two issues. Having found that the evidence reasonably supported the trial court's conclusion that the 1st Respondent acted in good faith and dealt with a person who possessed apparent authority to transact on behalf of the Appellants, it necessarily follows that any failure by that intermediary to account to the Appellants could not, without more, extinguish the rights already acquired by the purchaser. 10. The Appellants' counterclaim presupposes that because they were not ultimately paid the balance of the purchase price, the 1st Respondent should either surrender the vehicle or pay its value. However, that argument overlooks the distinction between the contractual obligations undertaken by the purchaser and the separate obligations owed by the intermediary to the Appellants. The evidence accepted by the trial court established that the 1st Respondent had acted in accordance with the transaction presented to her. There was no evidence that she knowingly participated in any scheme to deprive the Appellants of the purchase price. **The Allegations of Fraud** 1. The Appellants also pleaded fraud against the intermediary and relied upon those allegations in support of the counterclaim. It is trite law that fraud is a serious allegation which must not only be specifically pleaded but must also be strictly proved. 2. The Court of Appeal has consistently held that although the standard of proof in civil cases remains on a balance of probabilities, allegations of fraud require a standard of proof that is higher than that ordinarily applicable in civil proceedings, though not as high as proof beyond reasonable doubt. That principle was authoritatively stated in ***Vijay Morjaria v Nansingh Madhusingh Darbar & Another [2000] eKLR***, where the Court emphasized that fraud must be distinctly alleged and distinctly proved. 3. Likewise, in ***Kinyanjui Kamau v George Kamau [2015] eKLR***, the Court of Appeal reiterated that allegations of fraud cannot rest on inference alone and must be supported by credible evidence meeting the heightened civil standard. 4. Applying those principles to the present appeal, I have carefully considered the Appellants' pleadings and the judgment of the subordinate court. While the Defence and Counterclaim contain detailed particulars of fraud directed principally at the intermediary, the record, as reflected in the judgment before this Court, does not disclose any finding that the 1st Respondent herself participated in, had knowledge of, or benefited from any fraudulent scheme. Indeed, the learned trial magistrate accepted her evidence that she entered into the transaction as a purchaser for value and acted throughout in good faith. 5. In the absence of evidence linking the 1st Respondent to the pleaded fraud, the learned trial magistrate cannot be faulted for declining to grant relief against her on the basis of allegations that were not proved as against her. A party cannot be deprived of proprietary or contractual rights merely because fraud is alleged against another participant in the transaction unless it is shown that the party sought to be affected was complicit in or had notice of the fraudulent conduct. 6. The Appellants also criticised the learned magistrate for allegedly failing to consider the documentary evidence relating to the dishonoured cheques. In my view, even assuming that the documentary evidence established that the Appellants were never ultimately paid, that fact alone did not inevitably lead to the conclusion that the counterclaim against the 1st Respondent had been proved. The critical question remained whether the loss arose from any breach attributable to the 1st Respondent or from the subsequent conduct of the intermediary. The learned trial magistrate answered that question in favour of the 1st Respondent after considering the entire transaction, and I find no basis for interfering with that conclusion. 7. This Court is alive to the fact that the Appellants may well have suffered financial loss if, indeed, the purchase price was never remitted to them. However, hardship alone cannot justify imposing liability upon a party against whom the requisite legal and factual basis has not been established. Courts are enjoined to determine disputes according to the rights and liabilities arising from the evidence and the law, not according to sympathy for one party or another. 8. Having independently re-evaluated the evidence and the applicable legal principles, I am satisfied that the Appellants did not demonstrate that the learned trial magistrate misdirected herself either on the facts or on the law in dismissing the counterclaim. The dismissal was consistent with the court's findings on agency, the 1st Respondent's performance of her obligations, and the absence of proof connecting her to the alleged fraud or non-remittance of the purchase price. 9. Consequently, I find no merit in the Appellants' challenge to the dismissal of the counterclaim. The learned trial magistrate properly exercised her judicial discretion after considering the pleadings, the evidence and the applicable legal principles, and there is no basis upon which this Court should interfere with that determination. **Disposition of the Grounds of Appeal** 1. Having independently reconsidered the pleadings, the evidence tendered before the subordinate court, the judgment appealed against, the Memorandum of Appeal, the rival submissions filed by counsel and the applicable law, I now proceed to determine whether the Appellants have demonstrated any basis upon which this Court should interfere with the judgment of the learned trial magistrate. 2. As already observed, although the Memorandum of Appeal sets out twelve grounds of appeal, those grounds substantially raise four complaints, namely: whether the learned trial magistrate properly evaluated the evidence; whether she correctly found that the intermediary possessed authority capable of binding the Appellants; whether the dismissal of the counterclaim was justified; and whether the final reliefs granted were supported by the evidence and the law. 3. On the first issue, I have found that the learned trial magistrate properly appreciated the evidence placed before the court and correctly identified the real controversy between the parties. The trial court was alive to the Appellants' contention that the balance of the purchase price had not been remitted. However, after considering the entirety of the transaction, it concluded that the 1st Respondent had performed the obligations expected of her under the agreement and that any subsequent failure in the remittance of the purchase price arose from the relationship between the Appellants and the intermediary. I have found no basis for disturbing that conclusion. 4. On the second issue, I am equally satisfied that the learned trial magistrate did not err in finding that the intermediary possessed apparent authority to transact on behalf of the Appellants. That conclusion was not founded upon speculation but upon the conduct of the parties themselves. The evidence demonstrated that the intermediary negotiated the transaction, facilitated the acceptance of the trade-in vehicle, participated in the agreed payment arrangement and that the Appellants thereafter voluntarily released possession of the suit motor vehicle. Those circumstances were capable of leading a reasonable purchaser to believe that the intermediary had authority to conclude the transaction. 5. On the third issue, I have found that the Appellants failed to establish any error in the dismissal of the counterclaim. The allegations of fraud were directed principally at the intermediary and were not proved as against the 1st Respondent. Likewise, the evidence did not establish that the 1st Respondent acted fraudulently, dishonestly or in breach of the obligations she assumed under the transaction. The learned trial magistrate therefore properly concluded that the Appellants' remedy, if any, lay elsewhere and not against the 1st Respondent. 6. I am mindful that an appellate court should not interfere with findings of fact merely because another conclusion may also have been open on the evidence. As was stated in ***Mbogo & Another v Shah [1968] EA 93***, an appellate court will not interfere with the exercise of judicial discretion unless it is shown that the court misdirected itself in law, took into account irrelevant matters, failed to consider relevant matters, or that its decision is plainly wrong. Although that decision concerned judicial discretion, the principles of appellate restraint articulated therein remain instructive. 7. Equally instructive is the decision of the Supreme Court in ***Deynes Muriithi & 4 Others v Law Society of Kenya & Another [2016] eKLR***, where the Court reaffirmed that appellate intervention is justified only where the decision appealed from is shown to have been based on an error of law, a misapprehension of the evidence, or where the conclusions reached are plainly unsustainable. Having undertaken my own independent evaluation of the record, I am not persuaded that the impugned judgment suffers from any such infirmity. 8. The Appellants have invited this Court to substitute its own appreciation of the evidence for that of the trial court. While this Court possesses jurisdiction to re-evaluate the evidence afresh, that jurisdiction must be exercised judicially and with due regard to the fact that the trial court had the advantage of receiving the evidence first-hand. Upon my own assessment, I find that the conclusions reached by the learned trial magistrate were reasonably supported by the evidence and were founded upon the correct legal principles governing agency, contractual performance and the burden of proof. 9. The Court is further satisfied that the learned trial magistrate properly addressed the issues arising from the pleadings and gave reasons for the conclusions reached. The mere fact that the Appellants disagree with those conclusions does not render the judgment erroneous. An appellate court is concerned not with whether it might have reached a different conclusion but with whether the decision appealed from is legally and evidentially sustainable. In the present case, I find that it is. 10. Consequently, I find that none of the grounds of appeal has been established. The appeal therefore lacks merit. **Final Orders** 1. In the result, and for the foregoing reasons, I make the following orders: ***a. The appeal is dismissed in its entirety.*** ***b. The Judgment and Decree of the Senior Resident Magistrate delivered on 25th July 2024 in Nairobi CMCC No. 3997 of 2016 are hereby upheld.*** ***d. The orders directing the transfer of motor vehicle registration number KCC 727F Toyota Station Wagon to the 1st Respondent shall remain in force.*** ***e. The Appellants shall jointly and severally bear the costs of this appeal.*** 1. It is so ordered. **DATED, SIGNED AND DELIVERED AT NAIROBI THIS 28TH DAY OF JULY, 2026.** **HON. L. P. KASSAN** **JUDGE**